US “Unable to Stop Irans Oil Exports”

If the US reimposes sanctions on Iran’s oil sector without the support of Europe, China and Russia, it will see grudging and uneven compliance by international energy companies and will not be able to stop crude flows that returned to the market in 2015, according to sanctions expert Elizabeth Rosenberg, Platts reported.

“Grudging compliance does not look like robust, immediate information sharing to support the enforcement of sanctions,” said Rosenberg, the director of the energy economics and security program at the Center for New American Security and a former Treasury Department adviser on sanctions.

“In that world, sanctions are leaky, they’re not so strong and they will be revealed to Iran and the world to be not an effective tool of statecraft and there will be myriad opportunities for opportunistic business people — and confused business people — to find ways of continuing the business that they have in place,” Rosenberg said in an interview for S&P Global Platts’ Capitol Crude podcast that will air Oct. 2.

The possibility of the US going it alone on reimposing Iran sanctions has increased since President Donald Trump is widely expected to not certify Iran’s compliance in the 2015 nuclear deal before Congress’ October 15 deadline.

Rosenberg said Trump is understood to have certified Iranian compliance twice before “under duress” and has made clear to staff that he would not do so again. She said the administration likely thinks it can pressure Europe, China and Russia to agree to rework the deal and present the new version to Iran as a take-it-or-leave it offer.

If a new deal never materializes, the Trump administration or Congress could reimpose Iranian sanctions immediately.

osenberg said the move would damage US economic leverage at a time when it needs major Iranian crude buyers on board for other diplomatic priorities like leaning on China to help counter the North Korean nuclear threat.